(19 May 2017 – Ireland) Ulster Bank, AIB, Permanent TSB and Deloitte have come together to establish a pilot project that will explore new blockchain technology designed to improve the speed, resilience and security of the domestic payment systems.
Known as Project GreenPay, it will use technology developed in the UK by Royal Bank of Scotland, Ulster Bank’s parent company.
It has already been tested in Dogpatch Labs in Dublin, with the banks passing dummy payments to each other to test it for performance, accuracy and stability.
Ciarán Coyle, chief administrative officer at Ulster Bank, said the project would use RBS’s Emerald platform, which can acknowledge payments in under 10 seconds while handling large volumes.
“When we saw that RBS had that capability, we decided to use the platform in the Republic. We looked at how we could prove it at an industry level and looked at doing collaboration at an industry level.”
Blockchain automates the recording of ownership and transfer of value on a single, shared distributed ledger, without the need for a central arbitrator.
Transactions only need to be recorded in one place and are agreed at the point of recording by consensus. While records are added to the ledger with each additional block, no existing transactions can be changed or removed. And each block on the chain is a permanent record that cannot be rewritten.
“It’s essentially a software that provides a way of recording transactions in a trustworthy way,” Mr Coyle said.
David Dalton, Deloitte’s financial services leader, said the pilot would leverage the firm’s regional blockchain lab in Dublin. “We believe blockchain adoption will happen more quickly than anticipated and without a proactive and well-adopted strategy, banks and insurers risk being locked out of potential innovations enabled by this technology,” he said.
Some estimates place the benefit of blockchain in cross-border clearing and settlement at US$50-60 billion on a cost base of US$150 billion.